I did some further tests and it really does look like Mavpilot is waiting for the other side to send first. Its not a real problem providing I make the changes above to the mavgateway file. Also to ensure that the iPhone is aways assigned the same IP address I made the following changes to the /etc/dhcp/dhcpd.conf file.
host iphone {
hardware ethernet xx:xx:xx:xx:xx:xx;
fixed-address 192.168.42.9;
where xx:xx… is the Mac address of my iPhone